Research into "How Widespread and Predictable is Stock Broker Misconduct?" by SLCG indicates that prior customer complaints against individual brokers can indicate future complaints. McCann, Qin, and Yan discovered that including co-worker complaint histories significantly improves the ability to predict complaints against brokers who have not been previously complained about. They also found that customer complaints that were denied - not only settlements and awards - are useful in predicting future investor harm.

According to Egan, Matvos, and Seru, the regulatory landscape and job market do not effectively remove subpar brokers from the industry but rather direct them over time to firms that employ brokers with significantly more customer complaints. These brokerage firms, characterized by lenient hiring practices and minimal compliance standards, focus on targeting less knowledgeable investors.

In their related study, Dimmock et al. [2016] establish that financial fraud spreads contagiously. They find that a broker's inclination to commit financial fraud is significantly shaped by the tendency of their coworkers to engage in fraudulent activities, even when accounting for firm culture, branch dynamics, market conditions, and state regulatory frameworks.

Kevin Daniel Barlettas current employer, is one of the 30 highest risk brokerage firms measured by the percent of brokers at the firm who have customer complaints disclosed on their BrokerCheck reports. 15.00% of 's brokers have customer complaints compared to only 2.71% of all brokers who have complaints.

If you have questions about this post, about and/or Kevin Daniel Barletta or about the management of your accounts, please contact SLCG for an initial consultation or email us at BrokerInquiry@SLCG.com.

SLCG Economic Consulting, LLC

For almost a quarter of a century, SLCG Economic Consulting, LLC ("SLCG") has been delivering consulting services to individuals, businesses, and both state and federal agencies, primarily focusing on finance and economics. The team at SLCG comprises experts with extensive academic and governmental backgrounds who actively engage in research that is often suitable for publication.

SLCG is a wholly owned subsidiary of McCann Yan Holdings, Inc., a Virginia incorporated company based in Northern Virginia.